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‘Project Insight’: Income Tax Department To Use Big Data To Deter Those Posing ‘High Risk’ Of Tax Evasion
Income Tax Department (Facebook)
The Income Tax (I-T) Department is all set to use the troves of information available at its disposal from various government organisations and their databases to identify individuals who pose a high risk of evading taxes, reports Mint.
The departments ‘Project Insight’ will use data analytics to pursue and nudge assessees into filing for tax returns and comply with tax laws. The project also allows the department to identify those who are yet to register with the department and are ought to declare their income. This exhaustive profiling is due to the data it started collecting with the rollout of Goods and Services Tax (GST) in 2017.
The project will run through data it will collect from foreign banks, property transaction details, rental income, vehicle purchases and also identify spending pattern of assessees and thus identify individuals incompatible income with their reported income to the department.
“If ‘project insight’ is successful in mining all of these, it would certainly be one of the big contributors to the policy and administrative goals of the Central Board of Direct Taxes," said Rahul Patni, partner and tax digital leader, EY India.
The initiative will also mine into details of the individuals by monitoring and obtaining information from social platforms in a non-intrusive way before approaching them pay their taxes. It is believed that tax evasions happen from unaccounted wealth generation from real estate, educational institutions, film industry and mining. Estimates by experts say that tax evasions are around 10 to 150 per cent of the GDP of the country.
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